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Stop RIL’s marketing margin on gas sale: R-Adag

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The Reliance-Anil Dhirubhai Ambani Group (R-Adag) has asked the empowered group of ministers (eGoM) to consider on Tuesday the issue of marketing margin on sale of gas from the Krishna-Godavari (KG) basin charged by Reliance Industries Ltd (RIL) and said the levy should be stopped.

The eGoM headed by finance minister Pranab Mukherjee will on Tuesday consider allocating natural gas produced by RIL among new users in sectors such as power but may not give any fuel for the company’s petrochemical plants and refineries.

RIL said in an email release on Sunday that the marketing margin did not violate norms.

The company denies any allegation that the marketing margin charged under the GSPA (gas sale and purchase agreement) is in violation of the eGoM/GoI (government of India) decisions and/or the interim arrangement put in place by the Bombay high court order dated 30 January, RIL said. Under the PSC (production-sharing contract) for KG-D6, pursuant to an application by RIL, the government has approved a price formula for sale of gas at the delivery point under the PSC. While the risks and costs of the E&P (exploration and production) operations are covered under the PSC, the risks and costs incurred in marketing of gas have been explicitly excluded from the purview of the PSC.

October 25, 2009 · Filed Under Reliance ADAG, Reliance Industries 
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